The Psychology of Real Estate - Old Dominion University just released some preliminary results of an interesting study they're conducting about the way people view homes for sale, from pictures to descriptions to the attractiveness of their agents.
Something obvious is that people are less likely to think a house looks nice when there is a pink living room, even though it's easily corrected with a can of paint. We've known that for years and preach to our sellers to neutralize as much as possible, but also point out to our buyers that paint is cheap...
The part I disagree about is descriptions. I think I disagree because they aren't stipulating if the descriptions are for older homes or newer homes, but the study is making a blanket comment across all homes that if you put in the descriptions things like, "new paint, new carpet and/or roof work sold, on average, for slightly
less than those that did not."
I teach a class on the Psychology of Real Estate, and based on other reports I had seen in the past, my class discusses how these updates are very important to mention for homes that are older as buyers like to know they don't have to replace shag carpet or a 30 year old roof or wallpaper with paint.
The study says it effects the sales price because "If a seller says everything is new, a buyer might wonder why everything
needed to be replaced—and whether there are other defects lurking." This might be true in a newer home, but so NOT true in an older home. If these things weren't done in an older home, buyers would wonder what other maintenance items were never done, delayed, and/or overlooked.
Even though this study was based in Texas, they don't specifically say where in Texas, so I'm wondering if they just hit newer communities like the last 20 years or so, and ignored the sales from older communities. I don't see how they could make a blanket conclusion that buyers don't want to see information about updates done when all buyers talk about is how they want updates as they can't afford the work themselves...
**Are You Packed Yet?**
Donna Harris, REALTOR®
RE/MAX Austin Skyline
www.DonnaHomes.com
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Austin TX Real Estate and the surrounding areas of Lakeway, Bee Cave, West Lake Hills, Cedar Park, Round Rock, Spicewood, Circle-C, Steiner Ranch, and everywhere in between... Hill Country Austin TX Real Estate and beyond. Whether you're buying or selling an Austin home, I'll be with you every step of the way.
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* Psychology of Real Estate - Interesting Study Results * was first published on donnahomesblog.com
Great info! Thanks for posting.
I agree great information, I had never thought about people thinking something might be wrong if everything was new.
Thanks
Donna, I agree with some but not all of it. Especially how good looking the sales person is. People want service and knowledge in the end result.
You mentioned the word "new" which can have legal issues. We are told to never use the word "new" in our descriptions. The reason - from a legal standpoint if something has been used only once it can be technically labeled as no longer new but used. Apparently, there have been some libel issue for agents in our area who have used this term. Any thoughts?
Mario, Thanks.
Doris, That only makes sense in newer homes...
Ted, I thought that was weird too.
Janet, "I" didn't say "new", the study did. And you can say "new" if you put a date. For example, I usually say, "Updates as of 7/10 are new carpet, etc..." so as of July they were "new" and it gets around not having to say "newer" as it sounds stupid.
I really never thought of it that way! New has legal issues? That's a Lawyer looking for work...
Smile, It's gonna be a great week Donna!
Paul
Interesting study. I guess it's kind of like statistics - you can bend them to support your argument. I'm with you though, I'd much rather see new paint and new carpet - one less thing to worry about!carambol
Donna
That a very interesting study, I agree with some points and disagree with others. Thanks for sharing the information.
Good luck and success.
Lou Ludwig
Donna- Interesting study. I always wonder how much data they use and from where when they do these studies.
On the attraction one- I have done some extensive research for a different project on choosing attractive people over not so attractive people. They have done studies with even babies on this. The babies choose the prettier moms over the ugly moms. The 1st graders say that the ugly teacher who is super nice is mean and the pretty teacher is nice. So I will sway towards their study being correct in that regard. Nestor gets chosen all the time because of his good looks too, so it is not just a female thing:) Katerina
LOL - I know how important it is to understand our clients, but I didn't know that someone was doing studies like this for real estate. I never like generalizations like the ones you mentioned. It seems to me that as soon as someone tries to tell you how some one or some group thinks, they change and keep us guessing - it's like fashion - just fickle. Example: Lately I hear that 'all' buyers in our area are looking for granite counter tops, so if you want to show them a super house without granite counter tops, then the listing agent better not post that they installed 'new' formica, right? I think I'd take this study with a grain of salt.
Thanks for sharing...
So...if I dye my hair, lose weight, get a face lift, get the wrinkles removed and have a sex-change operation, my clients will pay more for the houses that they buy?
Just kidding!
Always interesting to hear about studies. Just don't make your life over because of them.
I find it hard to believe that people will pay more for something based on the appearence of the agent. But then no one went broke betting on the stupidity of the American public.
Ruthmarie- LOL! Shallow is what that is.
Donna, thanks for the post, interesting viewpoint about the descriptions. I've noticed with buyers unusual paint colors on walls is really the biggest turnoff, even though easily fixed.
Very interesting study. I'm with you- I think the study might be wrong about buyers paying less for homes with updates.
Thanks for the information! I agree with your thoughts rather than the studies...
That part about male clients with hot agents (uh, attractive female agents) ...... if you don't believe it, take a trip down to Fort Lauderdale or South Beach. A real eye-opener. You'll be a believer in no time at all.
as a mortgage lender i'll occasionally have a client saying well it has a new roof. well that's nice, but it doesn't change the value, as the expectation is that the house will have adequete roofing.
on the other side of the fence, if the life of the roof is 1-2 years it will decrease the value, and in today's world possibly cause your transaction to be denied.
good looks? well that's nice. i expect someone i'm dealing with to be professional in their appearance, but i'm not dating them, i'm asking them to assist in one of the largest investments in my lifetime. i'd say competency is the most important.
Donna,
Very interesting information, thanks for sharing.
I remember a former Miss USA worked for Corcoran in New York, I bet she sold many properties because of her looks.
When I go shopping for anything, I don't really care what the salesperson "looks Like".
I just want them to know their stuff. But, I am not a male so that may be clouding my perception.
Studies can be interesting and great conversation starters, but you wonder how accurate they really are. Something to think about though!
Interesting study. I think there will always be a segment of the population that is turned on by looks rather than excellent customer service. I'm glad that most people are looking for good, honest service. I would also like to know more about the vaiidity of that study. Doesn't sound like it's based on scientific methodology.
I have a house that is painted pink! (not common up here in PA) I wonder if it applies the the exterior as well.
It is all about the money when it comes to the studies. Follow the money-who is making it from this study?
Studies also show one of our four of us is mentally ill. Real estate is a numbers game. You try to put forth the best information available..with clearly written, concise but detail loaded copy, more and better images, a real full motion video to show how the real estate property components connect, go together in the puzzle. A saleman is less arm twisting and reverse psychology games and mental acrobats. It's hustling to provide detailed information, help with financing, local community background, delivery of a helpful service. We see if one person out of a hundred surveyed is paranoid about why all the new updates..what are they hiding..a fire, its haunted, etc sometimes the whole focus shifts to the vocal minority. And forgetten is the silent majority that graze on that information very differently without negative reaction, or assumptions you can not really control, shape, stop. Do what works best in your market and avoid the one approach fits the entire nation. Because like every market, people are different.
How interesting to find out that you teach also, Donna. WHEN DO you find the time, girlfriend? Interesting post!
Sorry. After the Bush years, I don't trust anything out of Texas. JK
Nice post. Congrats on your feature.
Donna, a very interesting study. I don't know if I can agree with the points it makes though. I would think your psychology of real estate class would be more realistic and would pertain more to the area where you work. Thanks.
It's all very interesting and fun to think about. House attractiveness, agent attractiveness. Perhaps this was really just a study in attractiveness.
Donna, great info and with some surprising zingers, I wonder if a female buyer would pay more if working with an attractive male agent? Naaaah...probably not!
Hope you summer is going well!
Hi Donna -- My little view is that to make statistics meaningful, you have to have a solid research design methodology, control variables, extreme data quality, SAMPLE SIZE, rigorous data collection, monitoring, adequate sample size, and the list goes on. People who perform evaluation research for a living know that even under the best of circumstances, one little thing can invalidate a study's conclusions.
That said, I think trying to make these types of assertions regarding real estate is an absolute joke. Even relying on hard core real estate statistics for even a community or CMA, etc., can be overridden by a properly prepared home, priced right and great marketing, so I tend to ignore all this stuff.
Donna,
This sounds interesting. In many ways it seems reasonable. So, it would be easy to postulate, but perhaps difficult to prove scientifically.
Brian
Fascinating read. I wonder what would happen if we changed our listings' property descriptions from time to time, and kept track of what marketing language made the phone ring more. Some words can be misinterpreted. Fresh paint and carpeting may imply that the house was a pit before.
Paul, Yes, "new" has legal issues, always had...
Melissa, I agree.
Lou, Thanks.
Katerina, Yes, it's proven that people like attractive people, but to say someone would pay more for a house sounds weird. It said women liked attractive females as well, but didn't pay as much as men did... and of course it didn't matter if the male agent was attractive...
Roseanne, I couldn't imagine marketing new formica even if granite wasn't the "in" thing.
John J, In short, yes!
Ruthmarie, True...
Pamela, Personally, that's where a buyers' agent needs to be doing their job to help a buyer see past paint.
Todd & Devona, I think it's very wrong!
Shanna, Thanks!
Scott M, I can imagine buyers wanting to work with attractive agents, but actually paying more for a house? Come on...
Jay, What the buyer is trying to tell you is that the new roof should "add" some value because it's something they don't have to worry about for the next few years even if the old roof was adequate.
Richard, Sold, probably, but for higher dollar?
Missy, The research on the women side was there was a slight finding with other women, but not when they worked with attractive guys. Women have more will power!
Pam T, Exactly!
Jean, Based in Texas off 50,000 closings... but Texas has a very low price range, so it's hard to gauge what type of buyers they dealt with.
Christa, Probably... I wouldn't want to live in a pink house, but if you market to Mary Kay reps, you'll probably sell it for top dollar!
Harry, To an extent...
Andrew, I couldn't quite follow your sentence structure, but I think you're saying everyone is different...
Lori, I don't like to be bored, so I do a lot of different things...
Gregory, Yet you trust who is currently in office??!
Michael, It's very realistic!
Kathryn, Possibly...
Russell, No, women don't pay more when working with an attractive male, but they do with an attractive female, just not as much as men.
Chris, Good points.
Brian, Hard to prove because you can't take those same buyers and put them with an ugly agent and see what they'll pay for a house!!
Millie, Again, it depends on the age. To mention "new" things in a newer house shows me there were/are issues, but to mention "new" in an older house means a LOT!
I see your point, Donna:
Year Built: 1975; New Kitchen; New Roof; New Paint; New Carpet... (Cool!), vs.
Year Built: 2005; New Kitchen; New Roof; New Paint; New Carpet... (What the...?!!)
Squishy brown stuff? I had to quickly check to see if you were from Lancaster County, PA. Because when I hear "squishy brown stuff" up here in Pennsylvania, I think apple butter.
But you're not, so you must mean the other squishy brown stuff . . .
AHHHH, so that explains why my female buyers are always wanting to overpay for homes. It all makes sense now.
Donna: As far as the last point in your post... the "squishy brown stuff" point... I have seen it happen time and time again... in the new homes sales industry. There are some builders who will ONLY hire gorgeous mid-twenties, this, long straight blond haired lovelies for their on-site sales positions. Oh yes... I am NOT kidding.
Now, for the rest of your post... great stuff. I will have to click on the link and read the rest of the report on the study. Thanks a bunch. Being a Psych Major, I really LIKE this kinda stuff. <smile>
Bill, Exactly!
Richard, Yes, the "other" stuff on the bottom of your shoe!
Greg, Didn't you read the entire study? Attractive men have no impact!
Karen Anne, I know what you're talking about. I remember back when DR Horton wouldn't hire anyone who wasn't part of their actual family!
Donna, that is just hilarious that you mentioned Horton, because that is the builder I was talking about. Horton in Fort Worth. I was their Realtor of the Quarter several times, so I knew them fairly well. Some years ago I referred an excellent sales person to them to consider hiring, and when I explained that this "fellow" was not female, was not 22, was not skinny as a rail, and did not have implants, but he could sell like a maniac, I was told... "well... in that case... we DO make exceptions." LOL. They hired him, and he did great.
Most of the reps in the Dallas area were men... very strange...
So will a female buyer pay more for a house with an attractive male agent?